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7 Reasons Why Referrals Don’t Turn into Sales

Gianfagna Strategic Marketing / Blog  / B2B Marketing  / 7 Reasons Why Referrals Don’t Turn into Sales
Referrals Not Turning to Sales | Smart Marketing Cleveland

7 Reasons Why Referrals Don’t Turn into Sales

Referrals are like gold in sales and marketing. Someone who knows you endorses your capabilities to someone who trusts them AND needs what you provide. It’s an ideal setup for new business, especially if you’re a B2B marketer selling professional services.

But many referrals don’t turn into sales. Marketers make costly mistakes that derail the sales process before, during, and after a referral takes place.

Here are seven reasons why a referral may not result in a new customer and tips to avoid these mistakes in your sales and marketing strategy.

Sales #Fail: Why Referrals Fizzle Out

A customer or colleague calls or sends you an email: “I just referred someone to you.”

If you’re like most marketers, your heart starts beating a little faster. But despite the warm handoff from someone the prospect trusts, you might not get the business. Here’s why:

  1. You flunk the web screening: Even if the Pope referred you, the prospect will check your website and social media accounts before they contact you. If your site isn’t fresh, current, and easy to navigate or your social media posts are unprofessional or nonexistent, you may never get a call.
  1. The referrer isn’t sure what you do: While referrals are great, you may find yourself being recommended for opportunities that don’t match what you do best – or even what you do. This happens when colleagues are unsure about your capabilities or don’t know you as well as they should. It’s essential to a) stay visible in your network via industry associations and social media and b) establish your expertise by publishing informative content on LinkedIn or in a blog or e-newsletter. Referrers who understand and can describe your work accurately will send you leads suited to your capabilities.
  1. You don’t ask the referrer enough questions: Before you follow up on any referral, talk with the referrer to learn about their relationship with the prospect, their understanding of the prospect’s needs, and why they thought you would be a good fit. Having answers to these questions before you call the prospect gives you a leg up in the sales process. You’ll be better able to position your business and engage in a meaningful dialogue from the start.
  1. The prospect has never heard of you: You don’t need to be a household name to capitalize on referrals, but the sales job is much harder if your brand is completely unfamiliar to the prospect. They’ll certainly check you out online (see #1 above) but you also need to actively and consistently market your business – all the time – to create awareness in your marketplace and a reputation for quality.
  1. Your prices are a mismatch for the prospect’s budget: Prospects who are unfamiliar with the services you provide or the reasons they need professionals of your caliber to do the work may be put off when you start talking costs. This can be hard to avoid, but it helps to be sure your referrer knows the types of companies you serve and has a ballpark idea of your rates.
  1. You push the prospect too hard: I recently asked a colleague I trust for a tech services referral. Before I could contact the suggested vendor, the vendor reached out to me. That’s fine; I appreciate their eagerness. But then they wouldn’t stop. Over a three-day period, I got four voice mails and three emails, after making it clear in an email response that I would call them when my schedule freed up. This vendor is about to lose the sale before they even get up to bat because they’re too aggressive (and bad listeners).
  1. You aren’t ready: When the call comes in from a perfect referral prospect, you need to be prepared to respond. If your materials aren’t up to date or your sales team isn’t properly trained or you’re in Belize and there’s no one who can take the call and engage the prospect until you return, the opportunity will be lost.

Important Final Tips for Smart Marketers

When someone puts their reputation on the line by referring you, it’s incumbent on you to follow up properly and professionally, to measure up to the expectations of your referrer.

It’s just as important to thank referrers for their recommendations and to look for opportunities to return the favor. No matter what you sell, respecting and valuing your business relationships is the smartest marketing strategy of all.

Get more tips on marketing by downloading free marketing strategy guides on my website or following me on Twitter: @jeangianfagna

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